Travel insurance is a type of insurance used to cover oddball travel expenses, such as medical expenses or losses of pre-paid deposits on airfare or hotel accommodations. Short-term travel insurance can typically be arranged at the time a trip is planned to cover the duration of a trip. This type of insurance is available for many types of travel, including student travel, business travel, leisure travel, and cruise travel.
Travel insurance can cover any number of risks. Among the most common are medical expenses, emergency repatriation travel expenses, repatriation of remains, trip cancellations, accidental death or injury, overseas funeral expenses, baggage loss, costs for the replacement of essential items, and legal assistance. Other types of additional coverage include coverage for preexisting conditions, extreme sports with elements of risk, travel to countries considered high-risk due to extreme weather or terrorism threats, and even kidnap and ransom insurance.
Whether or not travel insurance is right for you depends on a number of variables.
First, consider what events you would like to insure against, and how large the risk is in the country you’re traveling to. You can find out about certain travel-related risks from the US State Department website.
Next, you’ll want to think about what sort of events are already covered by your existing insurance. For example, most homeowner and renter insurance policies cover losses of property away from your home. Airlines usually reimburse you if they lose your bags. Any life insurance policy you have should cover you while you travel. (There might be exceptions to your policy for natural disasters, abduction, and terrorist attacks. In this case, you may want to consider travelers’ insurance.)
Also, check with your auto club membership and your credit card carriers. Many credit cards offer purchase and theft protection, as well as protection for canceled travel plans.
Most importantly, you’ll want to make sure you understand how your medical insurer will cover you in the event of an overseas emergency. If you are forced to take a prolonged stay in an overseas hospital, how much will they pay? What about an emergency trip home? Make sure you understand how much of this is covered. Travelers’ insurance for medical expenses is particularly important if you are a Medicare recipient because chances are that overseas expenses will not be covered.
You should also know the cancellation policies for all of your travel and accommodation plans. If only a small portion of your accommodation and transportation expenses are non-redeemable, insuring these plans may be throwing dollars into the wind. Also, if a flight or rail trip is canceled on you, chances are you’ll receive a refund, anyway.
Once you understand how you’re already covered, it’s time to decide if additional coverage is necessary. If you need any additional coverage to take care of possible expenses, it’s best to buy through a third-party insurer or agent, and not your travel agent. Sadly, plans from travel companies are often overpriced and contain many hidden exceptions.
Also, a reputable insurance agent can help you review your existing coverage and see precisely how much additional coverage you need if any at all. When you go to see insurers, make sure you ask them the hard questions like how much is the policy? What, exactly, is covered? How is the reimbursement amount determined? Exactly what kind of assistance does the company offer in the case of a medical emergency? Armed with all this information, shop around and find the least expensive policy with all the coverage you need.
Plans are available at all prices and for all levels of coverage. For example, insuring a single traveler for a five-day trip to Malaysia using American Express costs only $115. That buys $100,000 dollars worth of medical and dental coverage, accidental death coverage in the amount of $150,000, as well as coverage for trip cancellation, baggage delay, and travel delay. If there are gaps in your existing coverage, you can give yourself peace of mind for a very reasonable price.